The Litigation Budget

65 Pages Posted: 10 Oct 2014 Last revised: 22 Apr 2015

Date Written: October 9, 2014

Abstract

Because of fears that litigation is too costly, reduction of litigation expenses has been the touchstone of procedural reform for the past thirty years. In certain circumstances, however, the parties have incentives — both rational and irrational — to spend more on a lawsuit than the social benefits that the case provides. Present and proposed reform efforts do not adequately address these incentives, and in some instances exacerbate the parties’ incentives to overspend. The best way to ensure that the cost of a lawsuit does not exceed the benefits that it provides to the parties and society is to control spending directly: to require the parties to file and live within litigation budgets. These “litigation budgets,” which are already in use in the United Kingdom, help to ensure that the costs of litigation remain less than the benefits. After describing the workings of a litigation-budget system, the Article considers practical, political, and constitutional critiques. None of these concerns is disabling. American rule-makers who are serious about containing the litigation costs should grant courts the power to use litigation budgets.

Keywords: civil procedure, discovery, costs of litigation, case management

JEL Classification: K40, K41

Suggested Citation

Tidmarsh, Jay, The Litigation Budget (October 9, 2014). 68 Vand. L. Rev. 855 (2015), Notre Dame Legal Studies Paper No. 1441, Available at SSRN: https://ssrn.com/abstract=2507798

Jay Tidmarsh (Contact Author)

Notre Dame Law School ( email )

P.O. Box 780
Notre Dame, IN 46556-0399
United States
574-631-6985 (Phone)
574-631-4197 (Fax)

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